Don't invest unless you're prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong.
Risk Summary

Estimated reading time: 2 min

Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.

What are the key risks?

  • You could lose all the money you invest
  • Most investments are shares in start-up businesses or bonds issued by them. Investors in these shares or bonds often lose 100% of the money they invested, as most start-up businesses fail.
  • Checks on the businesses you are investing in, such as how well they are expected to perform, may not have been carried out by the platform you are investing through. You should do your own research before investing.

You won't get your money back quickly

  • Even if the business you invest in is successful, it will likely take several years to get your money back.
  • The most likely way to get your money back is if the business is bought by another business or lists its shares on an exchange such as the London Stock Exchange. These events are not common.
  • Start-up businesses very rarely pay you back through dividends. You should not expect to get your money back this way.
  • Some platforms may give you the opportunity to sell your investment early through a 'secondary market' or 'bulletin board', but there is no guarantee you will find a buyer at the price you are willing to sell.

Don't put all your eggs in one basket

  • Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well. A good rule of thumb is not to invest more than 10% of your money in high-risk investments. Learn more here.

The value of your investment can be reduced

  • If your investment is shares, the percentage of the business that you own will decrease if the business issues more shares. This could mean that the value of your investment reduces, depending on how much the business grows. Most start-up businesses issue multiple rounds of shares.
  • These new shares could have additional rights that your shares don't have, such as the right to receive a fixed dividend, which could further reduce your chances of getting a return on your investment.

You are unlikely to be protected if something goes wrong

  • Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker.
  • Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated platform, FOS may be able to consider it. Learn more about FOS protection here.

If you are interested in learning more about how to protect yourself, visit the FCA's website here.

For further information about investment-based crowdfunding, visit the crowdfunding section of the FCA's website here.

Company News

GrowthCapitalVentures receives stellar support from partner

The latest issue of Aycliffe Today, the online and offline magazine which is full of all the news from Aycliffe Business Park, is out now.

There is a fantastic write up about the support GrowthCapitalVentures has received from Endeavour Partnership, particularly for our online growth and impact investment platform, GrowthFunders.

Find out more about GrowthCapitalVentures' funding round, which successfully closed out in just 10 minutes.

A brief look at the article:


>We have worked closely with Endeavour Partnership for a number of years, but their expertise and guidance has been instrumental in the development of a suite of documents which support private investment from retail investors, professional angels, and venture capital funds.

...[we] understand that a good legal structure underpins any growing business. We thrive on challenging convention and innovating and we are always striving to evolve and improve on existing best practice. To do this, we work closely with Endeavour Partnership which is, we believe, the best business-focused law firms in the field.

Craig Peterson, COO GrowthCapitalVentures.

Endeavour recently supported our sister company Carlton & Co on the management buy-in of a Cambridge-based software company which will now form part of their portfolio of businesses and which will be developed and scaled over the coming years. Endeavour’s Corporate and Commercial team provided the necessary support to acquire a shareholding in the new company, providing a firm footing for growth.

Norman Peterson, CEO of GrowthCapitalVentures said: “Endeavour Partnership streamlined the whole process for us and ensured what could have been complex and time consuming was fast, efficient and simple and in line with the most stringent legal regulations in the industry. Endeavour not only supports us in our quest to develop as a North East business but the new companies we are working with.

To read the full article

If you're nearby, pop in and grab a free copy from the office or if you're not, click here to read the full story on pages 10-11 of issue #21.

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Growth Capital Ventures (GCV) is backed by funds managed by Maven Capital Partners, one of the UK’s leading private equity and alternative asset managers.